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Nyiru Company has a choice to invest in any of the two companies, A or B who have the following cash outlay of 15,000 and
Nyiru Company has a choice to invest in any of the two companies, A or B who have the following cash outlay of 15,000 and 16,000 respectively. The cash inflows for are as follows: Given that the management prefers a 15% interest rate. a) What project could be taken considering both the PBP and NPV as a basis of evaluating such a project. (10mks) b) What do you think would be the right IRR for project A and the one for B ? (10mks) Nyiru Company has a choice to invest in any of the two companies, A or B who have the following cash outlay of 15,000 and 16,000 respectively. The cash inflows for are as follows: Given that the management prefers a 15% interest rate. a) What project could be taken considering both the PBP and NPV as a basis of evaluating such a project. (10mks) b) What do you think would be the right IRR for project A and the one for B ? (10mks)
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